COLONIE — A New York City investment bank has threatened to sue Plug Power over an apparent deal to find the Latham fuel cell manufacturer business financing.

Plug Power, which has been experiencing cash flow problems and recently sold $2.8 million in stock to stay afloat until the summer, says in recent regulatory filings that the investment bank, Chardan Capital Markets, has said it may sue the company for more than $1.25 million for breach of contract.

Plug Power mentions the dispute in a prospectus sent to potential investors for the recent stock sale, which it says stems from a exclusive contract that Chardan says it had with Plug Power to arrange financing for power purchase agreements.

Power purchase agreements are becoming increasingly popular in the renewable energy field, including the solar and fuel cell markets. Businesses looking to generate on-site electricity from solar panels or fuel cells, which typically run on hydrogen, often find the up-front costs of the technology prohibitively expensive.

Cheaper alternatives include leasing the equipment or entering into so-called "purchase power agreements" in which the business signs a long-term fixed-price contract for the electricity only.

So far, purchase power agreements have been popular with stationary fuel cells for backup power at industrial sites or cell phone towers.

But Plug Power, which abandoned the stationary fuel cell market several years ago, makes fuel cells fitted for forklifts used in warehouses by companies like FedEx and Wegmans. It is unclear if Plug Power had been attempting to offer power purchase agreements to its customers as a new sales channel or if it has other ideas. Plug Power General Counsel Gerard Conway Jr. did not immediately return a call seeking comment.

According to Plug Power's prospectus, Chardan's lawsuit would allege that it had introduced company executives to a company called Sandton Capital to provide financing for the power purchase agreements, likely a complex deal.

But Chardan claims, according to the prospectus, that Plug Power "failed to engage in good faith negotiations" with Sandton and ended up finding financing with another firm, in violation of its contract with Chardan.

It is unclear if Chardan, which declined comment Tuesday, has filed a lawsuit, although a search of federal court records did not turn up one.

Plug Power says it sent a letter to Chardan on Feb. 7 denying any wrongdoing. It says it will "vigorously" defend itself if it is sued.